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DECISION

Approving the 2006-2010 export Development Scheme

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

At the proposal of the Trade Ministry in its Report No. 3281/TTr-BTM of May 29, 2006,

DECIDES:

Article 1.- To approve the 2006-2010 Export Development Scheme (hereinafter called the Scheme for short) with the following principal contents:

I. DEVELOPMENT VIEWPOINTS

1. To proactively implement the guideline on promotion of goods and services export, contributing to boosting GDP growth, developing production and employment in accordance with regulations of the World Trade Organization (WTO) and international commitments to which Vietnam is a contracting party.

2. To associate the domestic market with overseas markets along the following direction: Developing the domestic market to create sources of goods for export and concurrently expanding export markets to stimulate domestic production and market; expanding and diversifying export markets while expanding and further tapping the domestic market so as to support and reduce export risks in case of world market fluctuations.

3. To encourage and mobilize all resources of every economic sector and further attract foreign investment to boost the production of goods for export, step by step create branded products to meet the world market demand.

4. To promote import by concentrating resources on investment and production development; keeping trade deficit at a reasonable level by increasing export turnover as a major measure, not affecting the payment balance and macro-economic stability.

II. DEVELOPMENT OBJECTIVES

1. Overall objectives

To develop export at a high growth rate and in a sustainable manner. To boost investment in the development and production of export commodities, which are competitive and capable of holding large world market shares. To restructure export by boosting the export of commodities with high added value; processed and manufactured products and products of hi-tech content or high knowledge-based content, gradually reducing the export of crude oil; boosting the export of services.

2. Specific objectives

- To strive for an annual average growth rate of commodity export turnover of 17.5% to achieve a total turnover of around USD 72.5 billion by 2010.

- To achieve a national annual average growth rate of service export turnover of 16.3% toward a total turnover of around USD 12 billion by 2010.

- By 2010, of the total commodity export turnover, agricultural-forestry-fisheries commodities shall represent around 13.7%, fuel-mineral commodities, around 9.6%, industrial and hi-tech commodities, around 54% and other commodities, 22.7%. Geographically, of the total commodity export turnover, commodities exported to Asia shall represent around 45%, to Europe, around 23%, to America, around 24%, to Oceania, around 5.0%, and to other markets, around 3%.

- To proceed to balance import and export in the first years after 2010.

III. MAJOR SOLUTIONS

1. Supporting the business environment

- To expand the right to business and open the market for goods and service trading and distribution according to international commitments to which Vietnam is a contracting party; to ensure the principle of equality in the commercial provision of export-support services in Vietnam; to step by step eliminate monopoly in the provision of post and telecommunications, energy, insurance, communications, seaport and logistics services... so as to raise the efficiency of operation of, and reduce business cost for, the business community.

- To facilitate the establishment and operation of centers to supply raw materials and auxiliaries for export goods-producing enterprises.

- To reform customs procedures and modernize the customs service, shorten the import-export customs clearance time.

- To conclude agreements on international payment via banks for export markets with difficulties in transactions and payment guaranty; to conclude bilateral agreements on mutual recognition of plant and animal quarantine as well as food hygiene and safety standards with other countries.

2. Completing the system of financial, credit and investment policies for export

- To renew the credit policy in line with the market mechanism; to complete the development investment credit policy for production of export goods and the export credit policy according to the viewpoints and objectives of this Scheme, principles of the WTO and international commitments to which Vietnam is a contracting party; to expand forms of credit, assure more favorable conditions for capital access and more convenient forms of guaranty at commercial banks; to step by step provide loans to exporters that have stable turnovers and hold big market shares, especially in relation to agricultural commodities.

- To well observe the tax-refund mechanism applicable to importers of raw materials which are supplied to export goods producers.

- To reform and complete financial institutions by concentrating on input factors of export goods production and trade promotion, create conditions for raising competitiveness of export products; to continue improving taxes, charges and fees; to boost asset and goods insurance business in production, especially in agricultural production.

- To regulate exchange rates close to the actual exchange rates and suitable to the Vietnam dong's purchasing power, and, at the same time, adopt a policy to associate Vietnam dong with some convertible foreign currencies so as to avoid export risks.

3. Raising the effectiveness of the administration of trade promotion

- To renew the mode of operation, management and use of the foreign economic relation fund in order to promote its effect on the business community's activities of developing markets and seeking business partners.

- To diversify and expand forms of trade promotion.

- To improve the elaboration and implementation of annual national trade promotion programs; to coordinate trade promotion activities under big inter-branch programs on trade promotion, investment, tourism and culture to enhance the country's image, even through international telecommunication channels.

- To boost trade promotion at high-ranking level so as to accelerate cooperation, investment and business, particularly to attract transnationals to invest in the production of goods for export.

- To reorganize the system of trade promotion organizations and the mechanism of supply and forecast of market information and provision of consultancy on investment, trade, law as well as domestic and foreign business environment for the business community.

4. Training and developing labor sources for a number of export goods production branches

- To elaborate specific plans and organize the implementation of programs on job training to address the shortage of labor and improve labor quality in export goods production enterprises which are facing workforce difficulties; to step up the socialization of job-teaching and labor-training services; to balance budget sources to support the training of jobs for export goods production according to specific demands.

- To complete mechanisms, policies and laws on labor and employment so as to protect laborers' legitimate rights, raise their income and improve their living conditions; to encourage the business community to train and exchange human resources and laborers among themselves.

5. Elaborating a forecast program and schemes to boost commodity line-based export

- To work out a program to forecast and analyze the competitiveness through 2010 of major commodity groups and export services.

- To elaborate and implement schemes on boosting commodity line-based export (the production-managing ministries shall take initiative in elaborating, approving and organizing the implementation of such schemes) based on the development viewpoints, objectives and solutions in this Scheme, the above-mentioned program on forecasting and analyzing the competitiveness and the commodity line development strategy through 2010 already approved by the Prime Minister.

The elaboration of specific commodity line schemes must be conducted through consultation and coordination with the Trade Ministry, provincial People's Committees as well as concerned corporations and business groups so as to ensure the schemes' feasibility and compatibility with international commitments to which Vietnam is a contracting party; to attach importance to solutions to accelerating the process of association between raw material producers and export goods- producers and processers through economic policies, thus combining the interests and obligations of these two production groups on a permanent basis.

6. Restricting import deficit

Based on this Scheme's viewpoint of keeping trade deficit at a reasonable level, not affecting the payment balance and macro-economic stability and ensuring international commitments to which Vietnam is a contracting party, measures to restrict trade deficit are identified as follows:

- To boost the growth of goods and service export, first of all for markets where Vietnam experiences trade deficit, and regarding this as the principal measure to restrict trade deficit;

- On the basis of assured competitiveness and market demand forecasts, to develop the production of products with comparative advantages in order to meet the domestic demand; to renew production and management technologies to save raw materials, materials and fuels;

- To regulate exchange rates and interest rates in conformity with the economic development situation; to restrict trade deficit;

- To control and manage foreign loans and debts;

- To develop forms of services, tourism and labor export, attract overseas remittances;

- To attract more strongly foreign investment and ODA, and efficiently use these resources.

IV. ORGANIZATION OF IMPLEMENTATION

1. The Ministry of Trade shall:

- Coordinate with ministries, branches, localities, corporations, groups and commodity line associations in uniformly implementing this Scheme.

- Supply information, oversee, update and evaluate the implementation of contents of commodity line-export schemes; sum up, report and propose necessary policies and mechanisms to accelerate the implementation of this Scheme and commodity line-export schemes.

- Coordinate with the Foreign Ministry in studying and proposing a scheme on adjustment of the mechanism for use of financial sources of the foreign economic relation fund, and submit it to the Government for consideration and decision.

- Assume the prime responsibility for, and coordinate with the concerned ministries and branches in elaborating the program on forecasting and analyzing the competitiveness through 2010 of major commodity groups and export services; assume the prime responsibility for implementing the group of solutions to raising the efficiency of trade promotion work, the group of solutions to restricting trade deficit, and coordinate with concerned agencies in implementing the relevant groups of solutions under this Scheme.

2. The Ministry of Finance, the Ministry of Planning and Investment and the State Bank of Vietnam:

- The Ministry of Finance shall assume the prime responsibility for, and coordinate with the Ministry of Planning and Investment, the State Bank of Vietnam and concerned agencies in, mapping out a specific roadmap and implementing groups of solutions to supporting the business environment, completing the system of financial, credit and investment policies in service of export, and related contents of the group of solutions to restricting trade deficit; closely coordinate with the Trade Ministry and concerned agencies in implementing other relevant groups of solutions under this Scheme.

3. The Ministry of Labor, War Invalids and Social Affairs shall assume the prime responsibility for, and coordinate with the concerned ministries and branches in, elaborating a scheme on job and human resource training for identified export commodity lines.

4. Production-managing ministries and branches shall, based on their functions and tasks, have to study and implement specialized export schemes and closely coordinate with the Trade Ministry and concerned ministries in organizing the implementation of the contents and solutions of this Scheme.

5. Provincial/municipal People's Committees shall direct local functional agencies in elaborating and coordinating with ministries and central branches in implementing plans and programs for production development and acceleration of export of local products in line with the export development orientations laid down in this Scheme and specialized export schemes adopted by production-managing ministries.

Article 2.- This Decision takes effect 15 days after its publication in "CONG BAO."

Article 3.- Ministers, heads of ministerial-level agencies, heads of government-attached agencies and presidents of provincial/municipal People's Committees shall have to implement this Decision.